FITCHBURG -- The state announced Wednesday it is ordering an independent fiscal audit of the Fitchburg Housing Authority, after a review found "serious concerns" about its practices and excessive vacancy rate.

In a letter to FHA Executive Director Robert Hill, Department of Housing & Community Development Associate Director Lizbeth Heyer said that, despite additional resources and technical assistance the agency has provided to the FHA over the past four years, it "continues to have an alarmingly high vacancy rate with approximately 100 units vacant at present."

"After reviewing the FHA's processes, especially those regarding your wait-list, maintenance, and unit turnover practice, we question your capacity to complete the necessary work to decrease your vacancies," Heyer wrote. "Based on our most recent assessments, we believe the vacancies persist due to a lack of senior leadership and management oversight."

DHCD conducted its review of housing and facilities management between Oct. 31 and Dec. 12, and found about 18 percent of Fitchburg's approximately 560 public housing units to be vacant. Wait-list procedures for family and elderly housing were also reviewed, and it was found that the wait list for family units was lengthy. About 15 applicants were ready to be offered units but had not been yet.

Director of Operations Bob Pacetti said in the report that there had been a "breakdown in communication and coordination between maintenance and management staff and systems.

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"It was found that units that were ready for occupancy were either not being reported to management or were readied but no applicants were processed for those units," the report states.

DHCD Undersecretary Aaron Gornstein said Wednesday that his agency has been working with the FHA for the past several years to address numerous concerns about high vacancy rates and certain management practices that are believed to have led to prolonged vacancies. Despite the state resources that have been afforded to the FHA, he said, it has failed to significantly reduce vacancy rates.

"The most significant concern is in the inspection of units and the turnover of units to get back online, supervision of staff and maintenance delivery and lease enforcement," Gornstein said.

Mayor Lisa Wong said that while state guidelines dictate that units must be turned around within 21 days, a state auditor's report published in 2009 notes that there were approximately 318 units vacant for a period between 150 and 301 days. Coupled with the recent findings, she said this is unacceptable.

"In this distressed economy when more and more families find themselves without resources for housing I find it entirely unacceptable that these vacancy levels persist," Wong said in a letter to FHA board of directors Chairman Joseph L. Melanson. "The fact that they have continued for a number of years leads to my lack of confidence in the capacity of both the executive director of the FHA and the director of maintenance."

Wong said she would also not be reappointing members of the current board, because she has "serious concerns" with "their holding the management accountable for their failure to adequately address issues that have been ongoing since at least 2005, or the lack of effective communication with my office."

Hill, who has served as director of the FHA since 1993, said Wednesday evening that he was surprised by the letter, as DHCD representatives have been working with the FHA for the last month and a half. He said the FHA also recently received just over $290,000 as part of a $2 million statewide DHCD initiative to renovate vacant units in need of improvements.

"Yes, we have more vacancies than we should. It's an issue of resources and the aging condition of our properties," Hill said.

He said some units have been vacant for long periods of time because "they require more capital dollars for renovation than we had available in the budget," and that previous state allocations for such renovations have not been substantial enough to complete the necessary work on a significant number of units.

"We've been working with the DHCD, and we're continuing to work with them," Hill said. "We welcome the independent audit. Any recommendations they make, we'll deal with and move forward."

The DHCD is requiring the FHA to provide a detailed plan by Jan. 31 as to how it will turn over its vacant units, reduce turnover time to 21 working days and reduce its vacant rate to an acceptable 5 percent. According to Heyer, a comprehensive review of the authority's administrative, fiscal and management practices will be conducted in January, along with a thorough fiscal audit to be conducted by a third-party firm to be recommended by DHCD.

Beginning Jan. 1, Gornstein said, DHCD will no longer provide subsidy payments for units vacant 60 days or more without a waiver from the agency.

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